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May 2012 Sales Auto Sales Continues to Lead -- or Beat -- the U.S. Economy

On the same day the U.S. Labor department released May job numbers that were worse than the dismal expectations of economists, Toyota said its May sales rose 87.3 percent. That’s not the man-bites-dog story, here. In May ’11, Toyota was suffering the effects of the Japanese earthquake and tsunami. It’s the domestic year-over-year gains of 30 percent for Chrysler, 12.6 percent for Ford Motor and 10.9 percent for General Motors that stands out as news. GM says its May sales are its best in 33 months.Even Chrysler’s gain isn’t such big news compared with Ford and GM. The May ’11 Chrysler number was still sufficiently low that the substantial May ’12 gain seemed inevitable. Ford and GM posted healthy gains, at least when compared with those Labor department numbers; just 68,000 new jobs in the U.S. last month, with unemployment rising by one-tenth of a point, to 8.2 percent.GM’s sales chief, Don Johnson (who leads up Chevrolet beginning next month) on Friday morning reiterated the company’s confidence that Americans will buy 14- to 14.5-million new cars and light trucks this calendar year. Few dispute the automotive sector is taking the lead in the slow, tenuous economic recovery. In the European Union, where the faltering economy threatens to bring down ours, only Volkswagen Group is making any money, leading sales on a sinking ship.This raises an obvious question: who, in the U.S., is buying new cars and trucks? Even though unemployment remains too high, with the “real” number more than twice the official number, more than 80 percent of the nation is gainfully employed, and they’re replacing old vehicles. Ford says the average vehicle age in the U.S. fleet is 10.8 years old, with the average car age at 11.1 years old. Ford says its commercial fleet sales accounts for 14 percent of overall sales, equal to its number from May ’11. There’s strength in small commercial truck buyers, Ford says, which means that even if we’re not building new homes and office buildings, we’re buying new roofs and getting the A/C fixed.What about the car/crossover buyer? The sales numbers appear to be saying that those middle/upper-middle class and rich buyers -- especially the rich buyer (see last month’s blog post) -- who have managed to keep their jobs and/or careers going are still buying new cars. The middle-class who used to buy $20,000 midsize cars now are buying $20,000 compacts, while the upper-middle class are buying the midsize cars and compact or midsize crossovers. Former premium car buyers are shifting to brands like Toyota, where sales chief Bob Carter says its conquest buyers are “optioning up.”Average Transaction Prices at Toyota division are up, Carter says, “some of it due to lower incentive spending, a lot due to content coming up. The hot cars have a sunroof, power seat and Entune. I don’t know if that equates to more affluence, but people are buying cars with more options.”Want more evidence that middle-class buyers are shifting to smaller cars because of price, not gas prices? Ford says gas cost an average of $3.80 per gallon at the beginning of May, but is down to $3.57 per gallon the last week of the month. But the top-five bestselling compacts totaled 76.2 percent of top-five midsize cars’ sales in April, and 86.6 percent of the midsize models’ total in May.The rich are buying what they’ve always bought, which means Mercedes, BMW, Audi, and Lexus, not so much Cadillac, Lincoln or Acura.And so, to the numbers …1. GM: 245,256, up 10.9 percent.*Ford Mustang, at 10,427, up 57.8 percent, passed Chevy Camaro, at 9023, off 4.5 percent. Dodge Challenger was up 41 percent, to 4816. Has Camaro jumped the shark, or did the 650-horsepower Shelby GT 500 give Mustang the boost?*Chevy Malibu sales jumped 15.5 percent, to 29,579. About 1600 of them were ’13 model Ecos. Chevy says Eco and the turbo four versions will equal about 20 percent of the new, ’13 Malibu’s sales.*Equinox, at 20,236 (+15.1%), outsold Cruze, at 19,613 (-13.6%).*Chevy Silverado was up 21.6 percent, to 34,555. GMC Sierra was up 22.7 percent, to 13,196. Combined, GM sold 47,751 full-size pickups, still 7000 short of the F-Series (see Ford, below).*Buick had a strong month, up 19.2 percent, to 18,565. Enclave led this, up 55.2 percent, to 6709 and LaCrosse was up 18.6 percent, to 5663.*Cadillac dropped 15.1 percent, to 9871, with CTS leading, at 4161, off 3 percent. SRX was off 0.3 percent, to 3900 units. Cadillac will record its first XTS sales in June.*Chevy Volt was up 249.3 percent, to 1680 units, and 7057 have been sold this year.2. Ford Motor Company: 216,267, up 12.6 percent.*F-Series sales totaled 54,836, up 29.3 percent.*Fusion was second, up 8.9 percent, to 26,857. Focus was next, up 11.1 percent, to 24,769.*Escape was off 0.3 percent to 23,077, as dealers clear out the old model to make space for the ’13 model.*Ford sold 939 Police Interceptor sedans and 876 Interceptor Utilities. (Chevy sold 313 Caprice PPVs last month.)*E-Series van also was up, 31.4 percent, to 14,160, and Transit Connect was up 52.5 percent, to 3937.*Taurus was up 9 percent, to 6844, and Explorer was up, 10.1 percent, to 14,662.*Lincoln sales fell 1.7 percent, to 7274 units. MKZ was the bestseller, at 2458, off 2.6 percent. MKX was up 26.7 percent, to 2197.3. Toyota Motor Sales: 202,973, up 72.9 percent.*21,477 Priuses sold, about 13,100 of them traditional liftback models, 1,074 of them plug-in liftbacks sold in 14 states so far, and the remaining 7,300 about evenly split between Prius-c and Prius-v.*Camry sales totaled 39,571, up 110.1 percent. Toyota’s Carter says the model’s average age buyer is 51 years old, down from 58 years old for the previous model.*Corolla was up 87.5 percent, to 31,847.*RAV4 was up 123.2 percent, to 19,248.*Lexus division sales were up 74.4 percent, to 21,463, led by RX, at 10,647, up 172.5 percent.*Scion sold 86 special edition FR-S models in May, its first sales month.4. Chrysler Group: 150,041, up 30 percent.*Ram pickup leads the automaker, at 26,040, up 29 percent.*Jeep Wrangler is second, at 13,274, up 40 percent, then Jeep Grand Cherokee, at 13,274, also up 40 percent.*Close behind was Chrysler 200 (the power of advertising) at 13,250, up 87 percent.*Dodge sold 10,682 Avengers, up 93 percent, but Caravan was its bestseller, up 32 percent, to 12,418.*Fiat sold 4003 500s, up 128 percent. It’s at 16,702 so far this year.5. American Honda: 133,997, up 47.6 percent.*Accord, 29,737, up 74.7 percent, regained second in the segment from Nissan Altima, off 11.1 percent to 22,690. Both are in sell-down mode as they’re about to be replaced, though the Altima’s release date is earlier than Accord’s.*Civic was up 82.6 percent, to 33,490, topping Toyota Corolla.*CR-V was up 54.4 percent, to 25,186 to take first place in the segment again.*Acura was up 62.1 to 14,586.*Acura sold 168 of its new ILX models, 34 of them hybrids.6. Nissan North America: 91,794, up 20.5 percent.*Sold 11,977 Rogues, up 72 percent.*Sentra was off 1.3 percent, to 7600, as Nissan prepares to replace the compact.*LEAF sales fell 55.3 percent, to 510, with 2613 sold this year.*Juke was up 66.2 percent, to 3298.*Infiniti was up 65.8 percent, to 10,592.*G sedan was up 40 percent, to 3758. Infiniti sold 2678 JX models.7. Hyundai: 67,019, up 13 percent.*Sonata was off 8.7 percent, to 20,765.*Elantra was off 5.6 percent, to 18,877.*Santa Fe was up 3.2 percent, to 6884.*Accent was a big gainer, up 303 percent, to 6166.8. Kia: 51,771, up 7.4 percent.*Optima was up 79.8 percent, to 13,364.*Sorento was off 7.2 percent, to 11,077.*Soul was off 9 percent, to 10,146.9. Volkswagen of America: 38,657, up 35.7 percent.*Best May for VW since 1973.*Third consecutive month Passat exceeded 10k sales, at 10,178, versus 1 of the old model last year.*Jetta sales still lead, at 15,175, though it was down 9 percent from May ’11.*Tiguan was 2475, off 19.9 percent.10. Subaru of America: 29,724 up 48.4 percent.*Best May ever pushed Subaru past BMW Group for 10th place.*Outback was up 9 percent, to 9192.*Impreza was up 235.8 percent, to 6786.*BRZ, at 271 units, outsold the 86 limited special edition Scion FR-Ses.11. BMW Group: 28,321 up 7.1 percent.*3 Series remains the bestseller, at 6321, off 22.1 percent.*6 Series had the biggest gain, at 725, up 159.9 percent.*X5 was up 39 percent, to 3730, while X3 was up 4.7 percent, to 2460.*Mini was up 6.1 percent, to 6153.12. Mercedes-Benz USA: 25,259, up 24.4 percent.*C-Class leads sales, at 6649, up 34.7 percent.*E-Class was off 3 percent, to 5576.*M-Class was up 65.9 percent, to 3198.*Smart sold 703 fortwos, while Sprinter sold 2041 units, up 43.7 percent.13. Mazda North America: 20,357, up 13.9 percent.*Mazda3 was off 3.6 percent, to 8474.*The new CX-5 led Mazda sport/utilities, at 3973 units.*CX-9 was next, off 4 percent, to 1724.*Miata was up 3 percent, to 621.14. Audi: 11,503, up 10 percent.*Bestseller A4 was off 4.2 percent, to 3058.*Q5 was up 5 percent, to 2332.*A7 was off 2.5 percent, to 792.15. Volvo: 6246, off 15.1 percent.*2125 S60s, 1751 XC60s sold.16. Mitsubishi: 5575, off 38.2 percent.*Mitsubishi notes that it has discontinued several lines without replacement, thus the sales drop.17. Jaguar/Land Rover: 4513, up 8 percent.*Land Rover was up 19 percent, to 3438.*Jaguar sales fell 15 percent, to 1075.18. Porsche: 2852, up 1 percent.*Sold 878 911s, up 43.5 percent.19. American Suzuki: 2360, up 3 percent.*Grand Vitara was up 25 percent, to 474.Midsize models in April:1.) Toyota Camry 39,5712.) Honda Accord 29,7373.) Chevy Malibu 29,5794.) Ford Fusion 26,8575.) Nissan Altima 22,690TOTAL: 148,434
Compacts in April:1.) Honda Civic 33,4902.) Toyota Corolla 31,8473.) Ford Focus 24,7694.) Chevy Cruze 19,6135.) Hyundai Elantra 18,877TOTAL: 128,596
Compact CUVs in April:1.) Honda CR-V 25,1862.) Ford Escape 23,0773.) Chevy Equinox 20,2364.) Toyota RAV4 19,2485.) Nissan Rogue 11,977TOTAL: 99,724

This is great news for the auto industry! Love the outlook on what is going on especially with Toyota good to see that, I think that coming soon Tundra will start to sell more and more!
Clint Bowyer had a Tundra made specially for him check it out http://on.fb.me/MvBnnY it is getting auctioned off June 22-24 benefiting Emporia Community Foundation for heartland citizens affected by natural and economic hardships.

Without SAAR, the only other comparisons can be the monthly sales year-over-year and YTD sales. Year-over-year is subject to all kinds of problems too, especially right now. The year-over-year sales for Honda and Toyota are comparing to their post-Tsunami sales - that's simply not a valid comparison. Even comparing the big 2 US automakers to a year ago is risky business because the Japanese Tsunami distorted the entire auto market.
The YTD numbers are probably more useful this month because the Tsunami didn't have a dramatic effect until after the April sales numbers, but the Tsunami affected even YTD.

Well, don't drive a Focus in the snow unless you know how to kill the traction control. We got stuck in a rental on a hillside in a dusting of snow and couldn't get the wheels to move. The car wasn't taking any input form the steering wheel or gas pedal. I had to get out and "push" and apparently that was enough force to allow some movement of the wheels. Once we reached the top of the hill which was about 500 ft. we broke out our phones and searched online to see how to kill the traction control.
Anyway the "Darth Vader" controls suck on the Focus and the back seat is for kids only. Also, we couldn't plug and play my iphone. You had to download software before that would work. We then tried the AUX jack and that only worked intermittently. We did get good mileage and it drove well.

I don't know why I bother responding to you, other than to say that the top four Google searches (and I had to switch from Yahoo to that infernal Google) on "May sales surprisingly bad" all were of the same column from Ward's Auto. Subsequent listings had nothing to do with the auto industry. All this misses the folly of analyzing auto sales based on SAAR.

Five weeks ago I sat in and test-drove a Ford Focus, Mazda3, Chevy Cruze, Honda Civic, and Hyundai Elantra. The fit, finish and quality of the materials on the interior of the Ford Focus was a good 10% ahead of the next closest competitor, the Chevy Cruze. Nothing cheap or fragile about it; Edmunds and Motor Trend are correct, it is the class leader. Didn't even see a Jetta or Corolla. Those plastic coffins simply were not good-enough cars for me to take the time to see.

Perhaps you're right. Perhaps nearly every other analyst except you was overly exhuberant from the fact that Jan 2012 through April 2012 sales were all above 14 million. Last I counted, that's 4 straight months above 14 million, not "one or two". Perhaps everyone else was surprised that May 2012 sales dropped despite added sales incentives but somehow you knew this would happen.
I think a better explanation is that you wrapped up your opinion AFTER it happened. It's easy to be an armchair quarterback.

This knowledgeable Auto Analyst is fine with the rate of car sales. Just six months ago, Edmunds.com estimated 13.6 million units, and Truecar.com estimated 13.8 units. Edmunds.com just estimated annual auto sales for just under 14.0 million units. Automakers such as Ford and Toyota have just raised estimates to the mid-14 million range. There is no problem with the rate of auto sales, considering that 2011 sales of 12.8 million, which was the best year since 2008. The problem might be with the practice of exhuberantly altering forecasts based upon one or two months of sales activity, without regard for seasonal buying trends, and the ignorant who can't see through it.

The title says April sales, but the article is about May sales. May sales were surprisingly bad. Don't believe it? Search on "May sales surprisingly bad".
The seasonally adjusted annual sales rate for May was 13.73 million, the first month in calendar 2012 when the SAAR dipped below 14 million. Knowledgeable auto analysts consider the May sales to be well below expectations and a sign that the weak job market is starting to affect auto sales.

Good to see Ford doing well, just wish the small cars were more attractive...they're nice....but they could be sooo much nicer...liking the new Focus' mechanicals and chassis, just still looks cheap and fragile inside...can't wait to see how VW does when they come into their own in the US...they got 6 years to go....